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Carmike So Cheap After 115% Rally Spurs Deal Thinking: Real M&A

Carmike Cinemas Inc., after more than doubling in price this year, is still the cheapest theater chain in America for rivals looking to acquire more movie screens and boost earnings from popcorn and ticket sales.

Carmike shares have surged 115 percent as Chief Executive Officer David Passman leads a turnaround that analysts project will return the Columbus, Georgia-based company to profit this year after six straight annual losses. Even with the stock gain, Carmike is valued at 4.9 times earnings before interest, taxes, depreciation and amortization in the last 12 months, the lowest among U.S. cinema operators with a market capitalization greater than $100 million, according to data compiled by Bloomberg.